Thursday 25 June 2020

Currency Markets Update 25 June

Globally, US equity markets fell more than 2.5% amid the concerns of second wave of corona virus. US dollar index recovered a bit to 97.20 levels, it will take further cues from US final GDP data for Jan-Mar’20 quarter, US economy is likely to contract by nearly 5%. German ifo business climate released at 86.2 against 79.7 previous month. 


On domestic front, IMF has sharply lower India’s GDP forecast, as it expect Indian economy to contract by 4.5% in FY21 against an earlier growth projection of 1.9%. As per IMF, impact of this pandemic is likely to felt through currency financial year, as it expect GDP to contract in all four quarters. On the other hand, Government has announced that urban and multi-state co-operative banks will be under supervision of RBI. This step has been taken as a course correction after the fall out of PMC bank. On flows front, USD 5.7 bn Jio-Facebook deal has been approved by CII, market is expecting that flow might hit on-shore in coming weeks. USDINR pair is trading flat near 75.67. USDINR pair has near support at 75.45-50 levels and resistance at 75.80-85 levels.

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